I have been absolutely amazed and gratified at the volume and quality of your ideaLab submissions.

 More than 500 of you have applied for 25 positions. Your ideas are amazing.

 One crime writer wants to use new digital tools to expand coverage of crime in L.A. on multiple platforms and in real-time. Another applicant wants to harness digital platforms and our brands to use social media as a form of emergency alerts.

 A circulation employee wants to build an explainer on how our customers can maximize their use of our E-Editions while an advertising sales rep assistant has an idea on harnessing cloud technology to stream solutions to our automotive advertisers. And while everyone is talking about the weather one employee wants to capture that on video and turn it into video-on-demand.

 Another employee wants to use game mechanics and user-generated content to involve our customers even more in the conversation on what’s happening.

 Each submission is worthy of real study and I have enlisted the help of Digital First Media’s Advisory Board – Jeff Jarvis, Jay Rosen and Emily Bell and Editor-in-Chief  Jim Brady – to judge the top 25.

Winners will be equipped with the latest tools and the Company will provide them the time and money to experiment. Each member of the ideaLab will be equipped, initially, with a Smartphone, tablet and laptop.

The Company will carve out 10 hours a week from their regular jobs to allow them time to experiment with these tools and report back on how we can change our business for the better. And we will add an extra $500 per month to their pay.

Other than that – there are no rules.

 We expect to post the winning 25 applicants by the middle of February.

 Stay tuned. The ideas will be worth it.

 Until next time, John.

Good Afternoon,

I usually get invited to conferences like this because I’m the newspaper guy digital people get a kick out of when I say the newspaper model is broken.

In the newspaper business you can be referred to as a digital “innovator” for just saying that, which, of course, is a bit like winning a tallest midget contest.

Clearly, we are not digital innovators in the newspaper business. But we are adapters.

And as most of the media world is finding out – we are also survivors.

Is the newspaper model broken? For print, as it currently exists? Yes, irretrievably. Read Clay Shirky or any of the many newspaper company Chapter 11 filings.

But are our core competencies in local news creation and local sales broken? No.

Is there a digital innovation as it relates to local content and sales we can’t adapt to? Again, no.
We literally close the loop on local in news and sales.

Coupled with the sheer scale of our local resources – almost always bigger than all of our local media competitors combined – we are finally, kicking and screaming, starting to adapt and change.

And we are slowly but surely starting to get this right. Even in print I might add as we discover new roles for the print platform alongside our digital efforts.

The University of London professor Celia Lury argues in her essay “The Brand as New Media Object” that brands themselves are platforms for content.

Professors Melissa Aronczyk and Devon Powers in their work “Blowing Up The Brand” argue further “the relationship between consumers and brands become less about the consumption of the product than about social relations, experiences and lifestyles such consumption enables.”

In an industry that has been hidebound to its production process – printing – but equally wedded to the belief that its brands stand for something, I think the professors’ arguments point to a way forward for newspaper companies as news companies.

Just as the printing press divorced the reader from the writer with the pen and created a whole new world of scalable audiences and techniques of communication, the new digital platforms demand journalists use each platform to its utmost advantage.

The first steps in this transition has been our Digital First strategy but clearly it is also a case of Digital Right – the right uses for the right platforms on the right occasions. And not just the simple re-purposing of content from one platform to another in order of priority.

Online stories today that do not link are now considered inferior by consumers. News companies, as brands, cheapen and destroy themselves if they do not allow the social interaction that society now demands of the new digital tool set.

Marshall McLuhan knew this when he said the Medium Is The Message.

In the news business, particularly a legacy business like newspapers, if we don’t understand this and take advantage of the Medium’s potential we will cease to be the Messenger.

And it is in this role of Messenger that we have tied up our ideas of brand values. Such as a Messenger the community can trust. A Messenger known for its accuracy, integrity, etc.

But what does it mean to be the Messenger in today’s new news ecology where the people we used to call the Audience are now equally participants, competitors, colleagues, arbiters and sources?

At Digital First Media – where we operate Media News Group and the Journal Register Company and their more than 800 products – we have started to answer that question by first unlocking our brands and sharing our content into this new eco-system for all to use. And where we, in turn, aggregate the Audience’s content, curated under our brands.

The Audience – at the Journal Register Company – has responded to this initiative by doubling in about a year.

(A small housekeeping note: Many of my references today will be about the Journal Register Company which we have now run for about two years whereas we just took over operations at Media News Group three months ago).

Extending Professor Lury’s argument that brands are platforms we have taken our initiative to unlock our brands and share our content one step further.

In Torrington, CT we have literally extended our brand, the Register Citizen, by using the newsroom itself as a platform.

At the Register Citizen we have established an Open-to-the-Public newsroom and all are welcome.

They are welcome to work at blogging stations set up right in the newsroom. They are welcome to use the community meeting rooms and they are welcome to attend the news meetings themselves. For those who can’t make it the news meetings are also live-streamed.

In Torrington we have tried to embody the basic values of the web – transparency, inclusiveness and interactivity.
Online fact-checking boxes on every story is our direct request for help to correct any mistakes we may have made. I believe this is an act of transparency that is bonding us closer to that community.

To be clear, we no longer see our job as the old-fashioned agenda-setter or gatekeepers of information for our communities. Clearly communities know what they want and can organize themselves around issues and activities. You may have heard of a little thing called Facebook.

What we can do, however, under the power of our brands, which are still trusted, is help organize relevant information out of the river of content now available in each community.

And as the community has become even a physical part of the newsroom we are building a better connection – a closing of the loop – with that community than we have ever had before.

In Torrington, the community has responded by driving the newspaper’s digital audience to more than five times its print audience and it has taken the Register Citizen from a loss to profitability.

Along with the Community Media Labs at all Journal Register Company dailies and which are now being rolled out at Media News Group, Torrington’s Open-to-the-Public newsroom is becoming a new model of community engagement that works and enhances the news organization’s brand value.

This is a brand value being built by the community itself as the community takes ownership in what the local news organization does and helps to establish its key values of community involvement.

The gate is forever open now. There is no longer a gatekeeper on community news. Communities will now value those institutions – like Twitter – that help the flow of news and those – like us – that add context and reflect the values the communities themselves set.

Adding value to the new free-flow of news requires a new news organization.

In New Haven, CT we have created what we believe is a local newsroom that adds value.

It has four key components: Breaking News; Investigative Reporting; Audience Engagement and Widgets.
Audience Engagement and Widgets are the new no-brainers. Newsrooms must share content and they must engage their audience as demanded through the new digital tools that are powering social media.

No social media connection. No news organization.

While the crowd can be as fast or even faster on breaking news, adding the context we have through our community connection and professional newsrooms is both vital and additive to brand value.

However, it is the re-establishment of an investigative reporting unit – a victim of cutbacks in local newsrooms a long time ago – which can add the greatest value. Finally, again, and using the new digital toolset, we are asking questions that others are not asking.

That virtuous circle is complete when the news organization’s engaged audience pick up those questions and demand answers.

From a business perspective we are getting closer to the Holy Grail of value alignment with our communities.

Trust me when I say all of this is easier to say than do and it takes a commitment from the entire organization. If you are not fully committed the community will know it in a heartbeat.

While local is key to everything we do our Project Thunderdome – pulling together the strength of our local footprint and adding best of breed non-local content on all platforms – is creating huge national opportunities.

By centralizing all non-local content creation and production we are able to reduce costs while putting more resources back into local coverage increasing what is already an important competitive advantage.

Our scale not just at Digital First Media but also industry wide is a force to be reckoned with if harnessed properly.

We are extending the opportunity in content of Local Focus and National Opportunity to our salesfloors.

We start with our competitive advantage – we have more salespeople in our markets than any other of competitors. In many, if not in most cases, more than our competitors combined.

And we are adding the power of advertising networks to that by partnering but in our case an advertising network powered not just by numbers but also by brand value. At Digital First Media we call this our AD Taxi program.
In partnering with the right data and tech partners and leveraging not just ours but the right audience partners we are able to extend buys across our network of 41 million unique visitors and our own paid print circulation audience which is the second highest in the nation at 3.2 million on Sundays.

Like the open newsroom concept, by opening up our inventory and sales resources and by partnering we are adding to our brand value by offering behavioral, geographical and audience-specific solutions through search and extended inventory across our network and beyond to advertisers.

In short we are:
- Selling premium inventory on brand-enhanced newspaper web sites that ad networks can’t buy.
- Packaging digital products into an integrated campaign with select partners for premium out-of-network inventory on multiple digital platforms such as email and mobile.
- Data mining our user behavior to create more effective digital buys

And, again, we are leveraging the largest local media sales forces in those markets to do it.

Key to our Digital First strategy is allocating resources appropriately to our digital future as opposed to our print past solely. With local digital advertising network growing nationally by 50% – along with the explosive growth rates of mobile and the continued upward climb of search – this effort is a big part of our future.

Culture change is key to any organization attempting to transform from what it was to what it needs to be.

At Digital First Media that change has been most evident in our newsrooms and content processes but it has also played a huge role in the sales process and how we go to market.

All digital start-ups talk about failing fast. In print we are masters at failing slow – the industry is in its 17th- straight year of paid circulation decline.

And it is true that print dollars are becoming digital dimes to which our response at Digital First Media has been – then start stacking the dimes.

All of that requires a big culture change. A change that requires an adoption of the Fail Fast mentality and the willingness to let the outside in and partner.

At the Journal Register Company – and now soon to be rolled at Media News Group – failing fast has been a key to driving success.

We are now launching about one new sales product each week. We source centrally and train and implement locally. Our local sales forces call it the The Firehose. An unending stream of products and ideas because in this transition no one knows what will work unless you try.

To fill that firehose requires partnering. And just like in yesterday’s newsroom the old-fashioned closed salesfloor didn’t partner very well. That’s now changed.

The results have meant that at the Journal Register Company those dimes have stacked up to 5 times more digital revenue in 2011 than 2009. And those dimes now more than pay for all of Journal Register’s newsrooms. This is a performance about to be repeated at Media News Group.

So where does this lead us?

If newspapers can change and become multi-platform news companies – and I think we and the industry have demonstrated that we can change.

And if newspapers can learn to partner with both the Audience and the right content, sales and audience development partners.

I would suggest to you it is time for the newspaper industry to move from the defensive and onto the offensive. Time to step forward into the fight for our markets.

Because we can change and we have learned to partner and we already have the scale – as does the rest of the newspaper industry – that just about every content and sales start up is looking for.

At Digital First Media compared to most start-ups in our field we are very much outpatching the likes of, well, Patch.

With 57 million customers each month on all platforms in hundreds upon hundreds of markets with our quality brands and the largest contingents of content and sales personnel we are driving $1.4 billion of total revenue. About $1 billion of that is in advertising and of that about $130 million is digital advertising.

And we are just getting started.

We know we can’t do this alone and we have learned the power of partnering – particularly with start-up pioneers like SeeClickFix and DailyMe – to drive our transformation from print to digital.

To that end we are launching in Q1 of next year Digital First Ventures

The new company will make investments in tech start-ups focused in the areas of content, advertising and audience development.

Partnering is vital to any media company’s growth whether it is an established media company or start-up. We are going to marry our considerable scale with start-up innovation to build success.

We’ll be releasing more details on this at a later date.

So, I put it to you, that in the newspaper industry, you now have an industry willing to change, attempting to change, experiencing some failures but also some successes.

And while the final form of that future success is yet to be revealed, I would not – with new partners’ help – count us out in getting there.

Without proactive change there is no future for newspaper companies in a Digital age.

At MediaNews Group and Journal Register Company we understand that and are shifting our rate of change into high gear. About a month ago we announced the leadership of the newly formed Digital First Media to run both companies.

Since then, company President Jeff Bairstow and I have been working with key management and today we are announcing a number of operational changes, initiatives and management appointments that will put the right leaders in the right structure to effectively implement our Digital First strategy.

Our strategy is simple – allocate the right resources to drive Digital audiences and monetization while effectively reducing our old legacy infrastructure costs. In other words, grow Digital products, platforms, content offerings and revenue – and grow them fast. And, at the same time, protect our print business.

In the newspaper industry Digital transformation is a bit like the weather – everybody’s talking about it but few are doing much about it at all. That won’t be the case at MediaNews Group and Journal Register Company.

We are putting into place a new structure that centralizes non-local content production, digital product and sales development, sales support and IT to provide solutions back to the Company’s local markets.

The new structure will allow local markets to focus on what they do best – the creation of local content, the growth of local audience and engagement and the monetization of that growth. It will speed up our time in launching new and needed digital products, reduce costs and let us maximize the scale of Digital First Media’s resources and market footprint.
Moving forward, under Digital First Media, the new operational structure for Media News Group and Journal Register Company includes:

All editors on ALL platforms reporting to Jim Brady, Editor-in-Chief of Digital First Media. Dave Butler, as previously announced, will be Executive Editor and will also continue to oversee all California newsgathering operations as our West Editor. Greg Moore of The Denver Post will also serve as our Central Editor and oversee Colorado, Texas, New Mexico and Minnesota. The East Editor, who will oversee Michigan, Ohio, Pennsylvania, New York and New England newsrooms, will be named at a future date. As before, editors will maintain their reporting relationship to their respective publishers.

All sales leaders on ALL platforms will report to Kirk MacDonald, Executive Vice President of Sales for Digital First Media. Adam Burnham, as Senior Vice President for Local Digital Sales, will be responsible for all local digital revenue in all markets. Chris Coda is named Senior Director of National Digital Sales and will be responsible for leading all digital national advertising sales across Digital First Media. Mike Petrak is named Vice President of National Print Sales and will lead all national print advertising.

As well, a number of Regional Vice Presidents for sales have been named, each with a solid track record in driving digital revenue. Pete Casillas will be responsible for California while Erik Smelser is responsible for the Northeast including New York, Connecticut, Massachusetts and Vermont. Kevin Haezebroeck and Ed Condra, who, respectively, already have responsibility for our properties in Michigan and Ohio plus Pennsylvania will take on sales responsibilities as well in this structure. Kirk will also do double duty and directly watch over sales in Colorado, Texas, New Mexico and Minnesota.

As before, sales leaders will maintain their reporting relationship to their respective publishers.

The Company’s Digital strategy, including ALL product deployment, will be led by Arturo Duran, Chief Digital Officer of Digital First Media. Alison Kane is the new Senior Vice President of Digital Products and Business Development and will be responsible for bringing all new Digital products to market and implementing Digital First Media’s business development strategy. Scott Cunningham is appointed Vice President for Digital Technology and Platforms and will be responsible for all Digital publishing platforms. Patricia Rodeawald is the new Vice President of Digital Product Development responsible for coordinating all centralized Digital product launches.

As previously announced, Chief Technology Officer Bob Mason is responsible for all of the Company’s system selections, deployments and I.T. infrastructure. Steve Rossi, Executive Vice President of Digital First Media, will oversee all California operations including Bay Area Newspaper Group and Los Angeles Area Newspaper Group. Jerry Grilly, Executive Vice President of Digital First Media, will oversee all Colorado, Texas, New Mexico and Minnesota operations. Tom Wiley, Executive Vice President of Digital First Media, is in charge of MediaNews Group’s New England properties including Media One and NENI. And all Human Resources functions will be centrally led by Robert Monteleone, Chief Human Resources Officer for Digital First Media.

If you are unclear about how any of these changes affect you just ask your supervisor.

What Can You Do?

Ok, so those are the new bosses but this Company isn’t going to change without you. We need everyone’s help in accelerating our Company from its print past to its multiplatform future.

To that end, Digital First Media is extending Journal Register Company’s ideaLab to include MediaNews Group employees.
To start, we are going to equip 25 MediaNews Group employees with the latest tools and give them the time and money to experiment with them. Each member of the ideaLab will be equipped, initially, with a Smartphone, tablet and laptop.

The Company will carve out 10 hours a week from their regular jobs to allow them time to experiment with these tools and report back on how we can change our business for the better. And we will add an extra $500 per month to their pay. Other than that – there are no rules.

How do you become a member of the ideaLab?

In about 200 words or less, what would you do with the tools and time to improve our business? Email me at jpaton@digitalfirstmedia.com or post here on my blog. Any MediaNews Group employee in any division or any department – part-time or full-time – is eligible. I will involve Digital First Media’s Advisory Board in the selection of the 25 staffers and make sure we let you know the names of the winners.

Okay, now it’s over to you.

Until next time,
John.

Today marks another important step for Digital First.

As announced earlier this morning, we have formed a new company – Digital First Media Inc. It will manage both the Journal Register Company and Media News Group and its mission will be to accelerate the transformation of both these great firms to a modern, multi-platform media company focused on local news.

And, let me tell you, it will be a powerhouse out of the gate with more than 880 products in 18 states serving more than 57 million Americans per month. More than 41 million of those customers are digital-only creating one of the largest online news networks in the country.

I will head Digital First Media as Chief Executive Officer as well as be CEO of both JRC and Media News.

Newspaper companies aren’t supposed to be able to change. Haven’t you heard?

Here’s another one: Digital dimes can’t replace Print dollars.

Then this: No one wants what we have to offer.

And then this one: Digital revenue will never be able to pay for a newspaper’s newsroom.

We are supposed to be out of ideas, out of money and out of energy. To our competitors, I say keep thinking that. It will make this transformation easier.

At JRC we have blown up a lot of that received wisdom from newspaper critics.

Since implementing our Digital First strategy in mid 2010 our Digital audience has doubled to more than 12.3 million uniques and our entire audience has grown from 14.9 million monthly customers on all platforms to nearly 21 million customers.

That’s more customers for what we have to offer. A lot more.

In Q2 of this year, 10 of JRC’s 18 dailies are up year over year in advertising or within 2% of last year’s ad revenues because of digital advertising growth. JRC newspaper digital revenue grew more than 81% year over year in Q2. That’s against an industry average of less than 10%.

Digital dimes can replace Print dollars.

And if our dailies continue on the trend they are on right now, by the end of the year they will have brought in more digital revenue than the costs of running their newsrooms.

Digital revenues can pay for newspaper newsrooms.

This battle to transform newspapers is far from over but now under the Digital First banner Journal Register Company’s employees are joined by the innovative men and women of Media News Group.

From storied titles like the Denver Post, San Jose Mercury News and St. Paul Pioneer Press an enormous amount of digital initiatives have been underway to transform Media News Group.

Now, together, we are going to accelerate that transformation.

All of us have one goal – to preserve quality journalism in the communities we serve.

And we are going to bring along the Crowd to help us. News is created and consumed very differently these days. The folks we used to call the Audience have a stake in this because they have a stake in their communities. The same communities we are dedicated to serving.

We believe without quality journalism there is no democracy. No First Amendment without a vibrant Fourth Estate.
This is the proposition we are dedicated to.

Collectively, we will harness the energy of nearly 11,000 employees in JRC and Media News to meet that challenge.
Because, we are not of out ideas, we are not out of energy.

We are just getting started.

Until next time, John.

Today we announced that the Journal Register Company has been bought by Alden Global Capital. And that’s terrific news for us.

Alden has been an investor in our Company for some time and they have had a courtside seat to the Journal Register Company’s radical makeover following our Digital First strategy. They know what we do, they like what we do, and today they are putting their money behind our efforts.

Alden knows the media space well and has other newspaper company investments. Today’s announcement is a ringing endorsement of your efforts and demonstrates Alden’s confidence in our business model. Importantly, it also positions us well to continue to pursue our Digital First strategy and expand our Company going forward.

So, we stay on our Digital First plan with our team and goals intact but this time with a solid financial partner backing us all the way.

We have miles to go but today marks one very important step on our journey.

I know you will have questions – email me or post them and I will do my best to answer them.

Here is the press release http://bit.ly/mTXyXA .

Until next time, John.

As career journalists and managers we have entered a new era where what we know and what we traditionally do has finally found its value in the marketplace and that value is about zero.

Our traditional journalism models and our journalistic efforts are inefficient and up against the Crowd – armed with mobile devices and internet connections- incomplete.

Our response to date as an industry has been as equally inefficient and in many cases emotional.

The French philosopher Roland Barthes argues that when culture becomes nature we are in the presence of myth. In our blustering for self-justification we have created a myth of our value. Without ever establishing its economic value, we have argued our value as journalists and journalism itself is self-evident and unassailable.

Well, the walls have been scaled and the fortress sacked. Fortunately, we are left with solid foundations from which to be rebuild.

At the Journal Register Company, we have some thoughts about how we can re-build to create true value. While we have had many successes over the last 17 months, as you will see in a moment, let me be clear this is all a work in progress.

Any attempt at re-building starts with an accurate assessment of what’s wrong.

If you haven’t seen this quote already or read Clay Shirky’s seminal essay, I urge you to read it as soon as possible.

Its key message is clear:

You don’t transform from broken.

You don’t tinker or tweak

You start again anew and build from the ground up.

For those in our industry who still believe we can continue with the same business models, I ask you to examine the evidence to the contrary.

U.S. newspaper advertising is now at 1985 levels –before inflation adjustment.

From 1985 to 2005, the average growth rate was 2.7% per year.

Take out the high-low and it is still low single-digit growth.

And those were the good old days.

From the US industry’s advertising peak in 2005 until now it is less than half of what it was.

And at the avg. growth rate of 2.7% it will take about another quarter of a century to get back to where it was – in 1985.

But that is not going to happen. The growth in marketing/advertising dollars will no longer be in traditional media in the longer term.

The damage from the last six years along with over-leveraged capital structures has left the US newspaper industry in ruins.

And finally, as if more evidence was needed, in the United States our key customers have abandoned us. Now, more Americans get their news via the web and this year more advertising dollars will be spent on the web than in newspapers.

The customers have spoken.

Perhaps the previous slide should have been entitled the “results” of a broken industry rather than the “why” because what might be less obvious to most observers are some underlying brutal realities:

Traditional journalism is dead.

The Crowd collectively knows more about any subject, city or event we choose to cover than we do.

Armed with the same tools – and in many cases – equal access to information and the search capabilities to provide history and context, the Crowd can do what we do.

I think any economist would argue – and certainly Dr. Picard, who will be speaking later this morning, has also pointed out – that when supply increases and the criteria we as journalists have ascribed to creating value – access to information/sources; research capabilities and context and distribution – is available to almost anyone, then value plummets.

Raised on a staple diet of “he said last night” journalism, coverage by the Crowd – via social media – is instant, increasingly contextual and in many cases more complete than a traditional media company could ever achieve.

With our core mission gone how do we add value? What’s the role of the journalist in this mix?

Look at the recent coverage by the New York Times’ Brian Stelter of the tornado in Joplin, Missouri. He was – via Twitter – a reporting machine but that work did not appear as a “story”.

At the evermore progressive Postmedia – Canada’s largest newspaper company – reporters on the campaign trail during the recent federal election did just that – report.

They filed directly to the web and via social media while editors back in the newsrooms crafted the live feed into traditional stories.

Our craft has been and continues to be profoundly changed.

The fact that our industry – with few notable exceptions – does not understand that and continues to plow on by slashing editorial, research, marketing and even sales resources to meet profit expectations is simply stupid.

Newspapers get the investors they deserve.

With newspaper management bankrupt of ideas they seek to please investors by slashing costs and driving short-term gains.

Investors, being no fools and recognizing newspaper managers have no plans to truly transform their business, are simply doing their jobs when they keep management focused on producing short-term gains.

Investors don’t buy into myth. They buy into math.

If you want investors to take a long-term view on our industry or our companies then you better give them a long-term plan that works. Give them a plan they will back.

And I would add it should be a plan built on the editorial floor where the core of our business lies.

The basic component of our survival and re-building can be found in the elements of our destruction.

The Crowd which has become our competitor is filling the web – the disintermediator of our industry – with news.

As a result, the web is a very crowded place for news. A filter is desired. It is even necessary.

Original and compelling journalism are key to standing out and it is the power of our brands, our reputation, that can spotlight – filter – for our audience where they should look for journalism they can trust.

Vint Cerf – called by some the Father of the Internet – and Google’s Chief Evangelist is very direct about this:

“People’s trust in journalism has always been about branding.”

So, what must we do?

First, if you have competitor so much bigger than you are such as the Crowd then you better make peace with it and partner.

Understand the Crowd’s value and add your value to theirs and turn the Crowd from a competitor into a colleague.

And if you listen to nothing else I have to say this morning then please listen to this:

Stop listening to Newspaper people.

We are well into our second decade of figuring out the web and by any measurement we have failed. We newspaper people are no good at it.

If you want to get good at it then stop listening to the Newspaper people and start listening to the rest of the world – the customers and advertisers who have already told you what they think and have moved on.

And, I would point out, as we have done at JRC – put the Digital people in charge. Of everything.

Find new voices and let them push you around.

In our case, we have invited the Crowd into our newsrooms – more on that in a moment – and have established an Advisory Board of leading Digital thinkers:

Jeff Jarvis, Jay Rosen, Emily Bell and Betsy Morgan, former CEO of Huffington Post.

Be Digital First and Print Last.

Stop focusing on the Print. It is in any newspaper’s DNA. It is not like you are going to forget to put out the newspaper.

Focus on the future. That future is not Print. It’s Digital.

Create a New Business Model.

A business model that   lets you transition into the growing digital markets of audience and revenue.

We know we can still add value to the journalistic process and we know our brands and their audience have value.

What we don’t know is exactly what the future will be like and this is where many newspaper companies falter.

Arguments about news’ sustainability as an economic model or future of the adjacency of advertising to news have nearly paralyzed our industry from taking, what I would describe as, sensible steps into driving new products on new platforms with the resulting new audiences that advertisers want.

In conference after conference, the handwringing of not being able to articulate an endgame has become stultifying. Unlike Print, our Digital competitors are not trying to solve for an endgame and therefore have the courage to experiment and build.

As I will discuss in a moment, at JRC we are doing just that successfully and preparing a sustainable, investable transition model to take on the challenge of the future.

This transition has to be self –funding and that means reducing Legacy media costs.

You have to slay the production god and the legacy costs that go with that old model.

Two-thirds of a newspaper’s costs are infrastructure – stuff you don’t want to do – and NOT in what you DO want to do such as create compelling content and effective sales.

Harness both the Cloud and the Crowd to drive down those costs.

At Journal Register Company we are getting out of anything that does not fall into our core competencies of content creation and the selling of our audience to advertisers.

Get rid of the bricks and iron. Focus on core competencies. And if it is not core then:

Reduce it or stop it.

Outsource it or sell it.

There are now companies who do most of this much better than any newspaper company does because those ARE the core competencies of the outsource companies.

You will need the expenses you save from those cuts to fund the new products and platforms you will need.

News now breaks Digitally both in its’ origin and creation by the audience using social media and spreads virally. To be in the news business now means you must run your business as Digital First.  And that means Print Last.

Print Last because that is how this new world works.

Print is a SLOW medium and digital is FAST. Atoms will never beat bits.

Each platform has its own advantages.

Each platform has an audience.

And each platform has a certain speed – Fast or Slow.

The quality of the journalism will be key.

Lousy journalism on multiple platforms is just lousy journalism in multiple ways.

Our Digital First transition strategy is centered on the cost- effective creation of content and sales and not the legacy modes of production.

It is a strategy that differentiates and prioritizes the allocation of resources – human and financial to the new realities of our business.

We can’t afford to allocate the new resources without reducing the old. Adding a new person or expense for every new Digital function is just putting more water into a sinking boat.

You have to multi-task.

And, again, you have to train your people to do so. If they can’t learn you have to let them go and hire those who can.

If done right, you will have a business model that:

Increases the quality and quantity of original content on the platforms of the consumers’ choice

Involves the Crowd

Expands Audience

Expands Revenue Opportunities

Lowers Costs

And Increases Profits

In a world where the Crowd knows so much more than we do – we have to experiment.

While we encourage all of our employees to do that, we actually pay some of them to do just that – experiment.

We call it our ideaLab.

The ideaLab is a select employee group – we asked them to apply online via my blog (and they did in the hundreds) – who are paid to experiment.

We supply them the tools (Droids, Smartphones, iPhones, iPads, Netbooks, etc); the time (25% off with pay) plus some extra pay as an incentive.

There are no rules.

They have come up with Customer Relationship Management Tools; Ad Tracking and Publishing systems all using free web-based tools.

Others have developed training programs for fellow employees to help them navigate this transition.

Others are concentrating on journalism itself.

Our Ben Franklin Project is another experiment.

On July 4th   - Independence Day – last year and across all of our 18 dailies, we:

Assigned

Reported

Edited

Produced: Web & Print Products

Using Only Free Web-Based Tools

We are changing our culture at JRC and are starting to play offense rather than defense.

With lousy I.T, and tools – but eager employees – this transition is happening.

We have built sales support systems using an iPhone and free Google tools.

We have successfully printed pages on a press using only free web tools.

Our Capital Expenditures have been reduced by more than half from $25M to $12M. Why pay for what you can do for free?

But more importantly, we have harnessed the power of our employees and the Crowd.

We are learning more about what the Crowd wants because we are asking and involving them in the process. And because of their input we expect to be producing more of what the Crowd does consider of value.

We share all of the learned information and tools publicly.

In the case of the Ben Franklin Project you can go the Ben Franklin site and you will find a link to our Ben Franklin In A Box Kit.

Click on it and try your own experiment. And share the results.

As I said at the beginning of my remarks while we are not getting all of this right we are getting some of it right at these results show.

We have gone from bankrupt to a profitable company.

We have doubled our Digital audience and are growing our Digital revenue at 7x the industry standard in the US. In fact, in about one-third of our divisions – with Print down mid single-digit percentage points – we are up year over year these past few months because of digital ad growth.

Compare that to an industry in the U.S. where advertising was down about 10% in Q1.

And all of this was done with fewer costs than in 2008 but not fewer editorial and sales resources I might add.

I believe strongly that this kind of financial performance is the direct result of our openness to partnering with the Crowd to improve our products and by linking/outsourcing and restructuring our cost structure to one that is flexible and effective.

And, more importantly, is the result of the appropriate allocation of resources to building our future rather than protecting our past.

For this success to continue, the walls have to come down.

Paywalls, if you have them, should come down. And any walls between you and the communities you serve through your journalism need to come down as well.

Going forward, I think it is clear that smart, original content, tagged with advertising will gain value by being shared through networks. Jeff Jarvis at CUNY in New York is doing important work around this very concept. He says this very clearly:

“In the future content will go to the audience rather than the other way around.”

Shared Content Equals Influence.

And Influence in the new eco system equals Engagement.

And Engagement equals Value to those advertisers and others trying to reach that Engaged Audience.

Good journalism today that does not link is not of equal value to good journalism that does. Walls stop links and walls stop networks and destroy value.

Shared Content has to be of the highest quality whether created, curated or aggregated.

And you must invest in a process that provides more of the only competitive advantage we have left – the mass creation of compelling, original content.

At the Journal Register Company, we believe our Project Thunderdome is the Open Source Content Machine to power the combination of value-creating, shared and original content.

I won’t dwell too much on this morning since our VP of Content Jonathan Cooper is here at the conference and will discuss our efforts on a panel later today.

Thunderdome allows our Company to partner with the Crowd, improve the quality of our shared content while reducing production costs and letting us re-invest in the creation of more, local, original content – our competitive advantage.

Cooper, along with Jim Brady and Steve Buttry are on an aggressive timeline to launch Thunderdome in the next six months. The long-term future of our Company depends upon it.

Key to all of our efforts is to open up our newsrooms and our newsgathering processes to increase audience engagement and to enhance the value of our content.

Instead of paywalls, we see greater value creation in the open sharing of our content. Our approach is to treat content like an API – available to any who want it.

At our open-to-the-public newsroom in Torrington, CT we have gone one-step further in including the Crowd in our news content creation efforts.

Community members are invited to sit in on news meetings, participate in our Community Media Lab – we now have 20 such labs across our Company – and to work at blogger stations set up in the newsroom itself.

A bit like democracy – it can sometimes be ugly to watch – but it is also exhilarating and is driving meaningful change. In Torrington that small daily now has nearly 6x more Digital customers than Print and it is profitable again.

We will be rolling out its open-concept to all of our daily newspapers.

I am proud to say that the Journal Register Company – once the poster child for what ails the US newspaper industry – is now a company with a plan and a plan for the future that is working.

Like all business plans in times of great upheaval, our plan isn’t without flaws and it isn’t unaffected by the economy but it is a better built foundation from which to grow. And it is a plan worth investing in.

Thank you for time and I would be pleased to answer any of your questions.

There has been a lot of news lately resulting from various news organizations posting rules governing their employees’ use of social media. 

Some of you have asked what are JRC’s Employee Rules For Using Social Media. To keep it simple I have reduced them to three:

1.

2.

3.

Until next time, John.

Take a bow – you did it!

Our goal was to hit $40M in profit in 2010. Well you did better than that – you hit more than $41M. Not bad for a bankrupt, beat up old newspaper company people had written off as dead in 2009.

But we didn’t write ourselves off. We picked ourselves up and got working.

We learned to harness both cloud and crowd. Using new tools and working the new news ecology we produced new digital products and revenue streams AND reduced costs. We focused on what we do best and linked to the rest.

We learned how to put out out daily newspapers and websites using only free web tools. And the Ben Franklin Project was born. We established the ideaLab and you came up with more and better products.

We put about 1,000 Flip cams in your hands and we now produce about 4,000 minutes of original local news video per week. Stay tuned for more on that next quarter – think JRC TV.

You changed our culture and how we think. And we are a better Company for that.

AIl of that change is reflected in our bottom-line.

I promised you would all share in that profit, so look in your pay check tomorrow – you will all find an extra week’s pay. All, that is, except for our senior executives. They have a bonus plan and it’s enough already.

I promised and you delivered. And I cannot thank you enough for your effort this past year.

Together, with your help, we are transforming the Journal Register Company into a modern news media company. A transformation powered by its employees.

Until next time, John.